Unexpected medical bills can be just as devastating to a family as a serious illness. Treatment for many common conditions, even if they aren’t deadly, can still be quite expensive and wreak havoc on the financial stability of a household.
Healthcare Costs and Household Finances – The Statistics
According to NerdWallet Health, high medical bills accounted for some sobering statistics in 2013: 56 million Americans struggled to pay their medical bills, 15 million used up all of their savings trying to pay these bills, 11 million took on new credit card debt in an attempt to pay their medical debt and 10 million were unable to cover their basic expenses for food, housing, clothing and utilities because of their medical bills. An additional 1.7 million Americans went on to file bankruptcy because of their medical debt, and three out of every 5 bankruptcy filings are due to medical debt.
Our Personal Struggle with Medical Debt
Over the last several years my family has had to deal with unexpected medical bills. Some were incurred due to sudden illnesses and others due to expensive treatments for chronic, but life threatening conditions. Like many, we put some of the charges for our insurance co-pays and prescriptions on our credit cards.
After losing my job in the Great Recession, and exhausting my unemployment benefits, our healthcare costs have nearly pushed us to the edge of complete financial ruin. My husband’s salary was just enough to disqualify us from any sort of government assistance, but we’ve been determined to try to pay down our debts and avoid bankruptcy. We’ve used the following strategies to try to control our medical debt.
What to Do When You Can’t Afford to Be Sick
The last thing that any of us want to deal with when we are sick, or when a loved one is ill, is our finances. If you have a sudden illness, or if you have a condition that requires regular doctor visits, tests and treatment, it will pay you to be proactive. Whether it’s a hospital stay, or regular medical care, if you know you are going to have difficulty finding the money to pay for your treatment, it will pay you to be upfront about it. Being upfront and asking for help can help you to save money on your medical care, as well as decrease the likelihood of your account being turned over to a collection agency.
Be Upfront About Your Financial Situation and Ask for Help
Most doctor’s offices have a separate billing department, or an office manager. Before your visit it over, be up front with both your doctor and his staff that you have some financial concerns about affording your treatment and office visits and see if you can establish a reasonable monthly payment plan with them before the medical bills start piling up.
If you are like us and have health insurance, it can be tempting to let them bill the insurance company first, but you are more likely to avoid your account being sent to collections if you will be upfront about your situation. Once an account has been sent to collections, the doctor or hospital is usually no longer involved and isn’t able help you with a discount or flexible payment plan. Some doctors will also dismiss you from their practice when your account is turned over to collections.
By being upfront about your situation, you will find that most doctor’s offices and hospitals have more flexibility to help you work out a payment plan or reduced rate. Some doctors offices may partner with groups in your community that can offer financial assistance. Sometimes they partner directly with the major pharmaceutical companies to locate patients that may need assistance affording their medications. You won’t know if they can help you unless you are upfront about your situation and ask for help.
One of my chronic health conditions is Crohn’s disease. I have to take several medications on a regular basis to prevent my immune system from attacking my gastrointestinal tract so that I don’t bleed to death or go into shock from rapid dehydration. At one point, I was prescribed an expensive biologic infusion that was over $10,000 a treatment, and my insurance company only paid 80% of the cost. I had to take these infusions every six weeks. Even when I was employed, this treatment was financially out of reach.
Discounts Based on Condition and Income
When I explained my situation to my doctor and his office manager, they were able to contact the manufacturer of the drug. This company did offer substantial discounts based on condition and income. By filling out some paperwork and going through a verification process, the company agreed to waive most of my co-pay, so I ended up only paying $200 out of pocket per treatment rather than $2,000. My doctor’s office also waived their fee to provide the infusion in their office.
I was on this medication for over two years, and it worked well to control my disease, but in 2010 I had a serious allergic reaction to it known as anaphylaxis. My airway swelled completely shut during the reaction. This led to respiratory collapse and then cardiac arrest. I had to be resuscitated by defibrillator and was then rushed to the hospital. This reaction caused me to have additional complications that required several hospitalizations and specialized respiratory care at home over the next six months. Each hospital stay was thousands of dollars. When I lost my job, we had no way to pay.
Government Assistance VS Assistance Direct from the Hospital
During my hospitalizations, I asked to speak with someone in the hospital’s financial services department before I left the hospital. They were very helpful, and at first the representative checked into what federal or state programs for which we might qualify. Unfortunately, my husband’s income was just over the threshold to qualify for any government assistance. We really didn’t want to file bankruptcy or just not pay our bills.
Fill Out the Forms and Return them Promptly
Each time that I was in the hospital, the representative from the financial services department had us fill out a form to request assistance directly from the hospital. Many hospitals have some sort of assistance that they offer to patients in our situation. It is a very long form, and it required detailed financial information, including a list of our assets, other debts, copies of our paycheck stubs, bank accounts. By being upfront, and asking for help, and taking the time to gather the documentation after my hospital stays, I was able to get a significant portion of the cost of my hospital stays waived by agreeing to regular payments.
Most hospitals and clinics have representatives in their financial services department that are trained to help patients to find ways to pay their bill when they can’t afford it, as well as to set up payment plans. Sometimes, you can also find help through your local department of social services. Even if you don’t qualify for government assistance, a social worker may be able to provide you with contact information about resources in your community that may be able to help you reduce your medical bills.
Other Ways to Save on a Hospital Stay
Prior to having these health issues, I have also been able to lower the cost of hospital stays in the past by asking for an itemized copy of all of the charges for a hospital stay. By looking over the charges, you may find that you were billed for items that you did not use or that they did not provide, or where you were over-billed for other items. By discussing this with the hospital when you set up a payment plan for you bill, they will sometimes waive or reduce the charge for these items. It may only reduce your bill by a few hundred dollars, but every penny counts when you are trying to control your medical debt.
Paying Upfront Can Garner You A Discount
Some hospitals, as well as some doctor’s offices, will also discount your bill by 10 to 20 percent if you will pay your deductible and co-pay upfront. While I wasn’t in a financial position to take advantage of this during some of my hospitalizations, I have done so in the past when my daughter injured her knee and needed an MRI. I’ve also done this in the past when my son had to be rushed to the ER for an exacerbation of his asthma. We saved several hundreds of dollars off of our medical bill each time that we did this.
One of my other medications is available in tablet form, but still has an expensive co-pay since it isn’t on my insurance company’s list of preferred drugs. By explaining my situation to my doctor, he was able to get my medication directly from the pharmaceutical company for less than my insurance co-pay. I picked up the supplies directly at his office and paid at the time if the visit. The application to receive this assistance was similar to one for the infusion.
Additional Ways to Save
In addition to the above tips to save on medical bills, I have found information about free and sliding scale clinics from my local health department. Sometimes, you can receive some healthcare services at a reduced fee directly from them, but they also usually have a list of providers in your local area that are willing to offer reduced fees for office visits and treatments based on income. When I was unemployed, I was able to go to my health department and receive referrals for dental care as well as eye care at a reduced rate.
What to Do if Your Bill is Sent to Collections
Sometimes, despite your best efforts to pay, you may have medical debt that is sent to collections. If you are hospitalized, you will probably receive more than one bill for all of your treatments. There will likely be a bill from the hospital itself, as well as the doctor that sees you, as well as a bill from the lab for any blood work or tests and you may have a bill from radiology for any x-rays or other imaging that is done. If more than one doctor is called in to consult, there may be separate bills for each specialist. If you have several hospitalizations in a short time, it can be easy for a bill to slip by your notice and end up in collections. While there are certainly horror stories about the methods of some collection groups, if you have a medical bill that ends up in collections the worst thing that you can do is ignore it. Ignoring it will not make the medical bill go away.
While it is unpleasant, you will want to take the phone call when the collection agency calls you. Some hospitals deal with agencies specialize in collecting medical debt. If this is the case with your bill, the agent may be more flexible when negotiating payment. You will want to negotiate a plan to prevent legal action from being taken over the account. Sometimes, if you owe a substantial amount, if you are willing to pay the full amount in a short period of time, say 30 to 60 days, some collection agencies are willing to reduce the amount of debt by 20 to 30% if you can pay that amount quickly. If you enter into such an agreement with a collection agent, make certain that you get the agreement in writing before you pay, and get a receipt.
If you aren’t able to reach an agreement and pay, the agency may turn the account over to an attorney, who will sue and a judgment will likely be entered. It can take up to 7 years to roll off of your credit report. They can also garnishee your pay once a judgment has been entered against you. If you have several collection accounts and multiple judgments entered against you, your creditors may even make an effort to force you into bankruptcy to force you to liquidate your assets.
You also may find that you are unable to live on the amount of your paycheck that is left over after a garnishment. If you find yourself in this scenario you may have no other alternative than to consider bankruptcy.
Healthcare is expensive and even if you have insurance, it can be difficult to afford necessary care. These tips have helped our family to reduce our medical bills and for the time being, stave off bankruptcy and total financial ruin.